The Public Utilities Regulatory Commission (PURC) has issued a six-week ultimatum to the Board Members of the Electricity Company of Ghana (ECG) to pay a fine of GHC5,868,000.
The Board members of the Electricity Company of Ghana (ECG), who served from January 1st to March 18th, 2024, are required to pay the regulatory charge for overseeing power outages without notifying consumers during this period.
The board, including ECG MD Samuel Mahama Dubik and eight others, will be affected by this fine. Former board chairman Keli Gadzekpo, who resigned three weeks ago, will also be subject to the fine, along with Majority Chief Whip Frank Annor Dompreh and five other individuals.
However, current Deputy Energy Minister Herbert Krapah, who chairs the board, will not be affected as his tenure falls outside the period covered by the regulatory orders.
The Public Utilities Regulatory Commission (PURC) issued this directive in a letter to ECG on Monday, April 15.
“The Board Members of ECG in office between 1 January to 18 March 2024 shall pay the regulatory charge of Five Million, Eight Hundred and Sixty-Eight Thousand Ghana Cedis (GHS5,868,000.00) into a dedicated fuel account under the joint control of the Ministry of Energy and the Ministry of Finance on or before 30th May, 2024,” the regulatory body ordered.
The PURC had previously requested information from ECG regarding tariff revenue allocation under the Cash Waterfall Mechanism (CWM), regulatory audit data, operational information, and other relevant data, with deadlines of March 25, March 27, and April 2, 2024.
It said, “The Commission established from its analysis of data submitted by ECG that there were 4142 outages to consumers within ECG’s operational areas between January and March 2024. Out of this number, 165 representing 3.98% of the total outages were ECG-planned outages.
“Further analysis showed that of the 165 ECG planned outages, 40 were supported by public notices, while there were no notices for the remaining 125 outages. Further, 38 of the 40 notices did not comply with the requisite three-day statutory notice prescribed under Regulation 39 of L.I. 2413. This indicates that in 163 instances of planned outages, ECG did not comply with the law”.
Initially imposed on ECG, the fine was reassigned to the company’s board members by the PURC, citing concerns about the impact on ECG’s service delivery and the nature of its business.
“The Commission has determined that having regard to the nature of ECG’s ownership and business, the imposition of the penalty of Five Million, Eight Hundred and Sixty-Eight Thousand Ghana Cedis (GHS 5,868,000.00) on ECG would be counter-productive, as payment from ECG’s revenue would have a rebounding adverse effect on quality of service and consumers who pay tariffs to the company.
“For that reason, in the interest of justice and to protect the interests of consumers, the Commission shall hold the Board Members of ECG who were in office from 1 January to 18 March 2024 liable for the payment of the Five Million, Eight Hundred and Sixty-Eight Thousand Ghana Cedis (GHS 5,868,000.00).”
The Commission noted that these board members were consistently responsible for providing strategic direction to ensure the provision of safe, adequate, efficient, reasonable, and non-discriminatory service to consumers.
Additionally, the regulator has fined ECG GHS36,000 for its failure to submit all of its current bank and investment accounts to the Commission.
“The details of ECG’s bank accounts submitted were incomplete, contrary to the Order. 3.3 Submission of Information Related to Operational Matters.”
“The Commission hereby imposes an initial regulatory charge of 3,000 penalty units on ECG in accordance with Regulation 45 of LI 2413, amounting to Thirty-six Thousand Ghana Cedis (GHS36, 000).”
It said “ECG shall pay the initial regulatory charge of GHS36, 000 to the Commission on or before 22 April 2024.
On the time-frame for compliance, the PURC added that after the payment, “for every working day that the requested details remain outstanding, ECG shall pay an additional regulatory charge of 3,000 penalty units, calculated daily until the date of compliance.”
Additionally, apart from fulfilling its existing obligations under the Cash Waterfall Mechanism, the PURC instructed ECG to remit the sum of GHS446,283,706.29 to Category B beneficiaries under the CWM.
“The amount represents actual revenue collected by ECG, declared by ECG to the CWM, and approved by the CWM Standing Committee for payment from August 2023 to February 2024, but which remains unpaid.”
The Commission specified that ECG must pay the amount of GHS446,283,706.29 on or before April 30, 2024. Failure to comply by the specified date will result in the board members and management of ECG being held accountable.